Wednesday, Sept. 7, 2005 | 11:04 a.m.
CARSON CITY -- GOP gubernatorial candidate Bob Beers' suggestion to give motorists a break on the rising price of gasoline got a lukewarm reception from several key state lawmakers.
Gov. Kenny Guinn said he needs more details from Beers and wants to give other legislators a chance to express their views before deciding whether to convene the special session of the Legislature to discuss whether to suspend the state's gas tax.
The governor said Tuesday that he had been busy working on the plans to bring 800 victims from the Hurricane Katrina to Nevada and hasn't had a chance to talk with Beers.
Guinn also said that so far Beers hasn't come up with a plan.
Beers on Tuesday said Guinn should call a special session of the Legislature to enact a two-month moratorium on the state's 17.65-cents-a-gallon tax. Beers estimates the moratorium would save motorists anywhere from $42 million to $50 million.
But whatever it saves motorists, it will cost the state, and that's what has several lawmakers balking at Beers' proposal.
The gasoline tax revenue is used to build roads and fund the state Transportation and Motor Vehicle departments.
Beers' plan is to replace that tax revenue with money from the state's rainy day fund that is used for emergencies.
The rainy day fund now has $159 million and is expected to grow to $194.6 million by June 30, 2007. Beers' proposed moratorium did get some support from at least one elected official who happens to also be one of Beers' opponents in the race for governor -- Rep. Jim Gibbons, R-Nev.
"I believe that suspending Nevada's fuel tax is worth considering, which is why I am looking into similar action today at the federal level," Gibbons said Tuesday.
Lawmakers in a few other states were discussing suspending taxes on gasoline as well.
On Tuesday, Georgia lawmakers were in a special session called to ratify Gov. George Perdue's executive order to suspend gas tax collections there.
Meanwhile, in Michigan the House voted to allow the governor to lift that state's 6 percent sales tax on gasoline and diesel fuel during a fuel emergency. State lawmakers in Oklahoma, Massachusetts and Oklahoma have also proposed measures to suspend gas taxes.
Some Nevada Republicans and several Democrats said they are worried that oil companies might just keep raising their prices no matter what the state does regarding taxes.
Senate Majority Leader Bill Raggio, R-Reno, said there is no guarantee that those who control the gasoline supply would not increase the prices.
Assembly Majority Leader Barbara Buckley, D-Las Vegas, likewise, wondered, "What assurance do we have that the gas companies would not raise their prices?"
She said if that happened, the state would have given up the tax revenue while motorists continued to suffer at the gas pumps.
Beers said competition might solve that problem. Motorists could save at one station that lowered the price and boycott another station that raised its price to offset the tax reduction.
Buckley also said she doesn't support taking the money from the rainy day fund but there might be some other money available.
She said the rainy day fund must be maintained in case the state runs into major, costly emergencies down the line.
Raggio said he, too, is "nervous about depleting the rainy day fund." He estimated the loss in revenue would be $50 million and that would leave the fund with slightly more than $100 million. He wondered how the state might be able to handle the costs of dealing with an emergency such as a flood or forest fire.
He said it must be determined whether the rising gas prices constitute a "fiscal emergency" or just a "fiscal inconvenience."
The law says the money can be taken from the rainy day fund only if the Legislature and governor declare that a fiscal emergency exists or if tax revenues come in 5 percent or more below estimates. Tax collections are running ahead of predictions so that provision can't be applied in this case.
Beers, in his campaign last weekend through rural Nevada, said he found the average price of the regular brand at $3.09 a gallon and premium at $3.39. Georgia's governor suspended the state's gasoline tax for a month to help motorists.
Beers said he does see this as an emergency because "the increased cost of gasoline has the potential to really hurt Nevada's families, businesses and visitors."
Buckley noted that President Bush has authorized the release of some of the nation's gasoline reserves, and that may stabilize the prices.
Buckley said the public outcry over the spike in gas prices raises the question of whether the Legislature needs to have to have additional powers to act in emergencies. She said special powers might be conferred on the Legislature or on the legislative Interim Finance Committee to meet these types of emergencies.
Lorne Malkiewich, director of the Legislative Counsel Bureau, said a one-day special session would run anywhere from $20,000 to $50,000. It would cost between $13,000 and $20,000 to pay for the travel of the lawmakers to Carson City and pay their salaries and per diem costs.
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